School building: assumptions and repurposing

Last article, I wrote about my disappointment that the "recommendations" that came out of the School's elementary-school-building process didn't include any estimate of costs or potential impact on our taxes. This surely can't be an oversight since the consultants had cost ranges in every option, including the option of do nothing (just keep repairing the existing buildings.) The last article can be read here: http://www.actonforum.com/blogs/allenn/hidden-costs-and-pseudo-science

Whatever we do as a community must be primarily funded by property taxes. So no matter how much "input" we receive from "stakeholders," the ultimate decision on spending a large sum of money will be made by several town meeting votes in both Acton and Boxborough, and probably votes at the ballot box to tack on a surcharge for 20 years to pay off bonds. In other words, the decision will not be made by "stakeholders" but by voters, most of whom are taxpayers.

So I believe the strategy by the School is to box voters into approving new school buildings and force them to vote for higher taxes upon themselves, rather than really consider the much-less-expensive option of refurbishing the existing buildings and closing one because of declining enrollment. The less-expensive option will have been considered and rejected, so voters won't have that as an option down the road when they are asked to vote.
To make their case, they are using assumptions that are quite debatable...except that the School will claim the debate has already occurred and therefore voters just need to approve what everyone has already decided or face the calamity and negative consequences of failing to approve the plan: starting over a multi-year process while our school buildings crumble and a plague of locusts descends on Boxborough. They hope that voters will just grow weary and won't want to face several more years of uncertainty, so will vote against their own best interests and pocketbook.

ASSUMPTIONS

Making a decision that is very complicated involves balancing options and making assumptions about key issues at the start. Let me give an analogy.

Let's say you decided to build a new house. You and your spouse have no children, but plan to have them in the future. You will build your house in anticipation of meeting your likely future family's needs. How many bedrooms should your house have?

Two bedrooms is certainly a minimum. But if the plan is to have three children, you could justify six bedrooms (one per kid, a spare for guests, an extra for a home office.) Or you could have three bedrooms, figuring two of the kids will room together, skip the guest bedroom, and have an office in the basement. The cost of building a three-bedroom home is quite different from a six-.

Let's say you are able to ask the future kids to vote. Do you think they would each want their own bedroom? What if the decision is made by "majority rule" and the six-bedroom option gets three votes while the three-BR option gets the two votes (by the parents?)

Maybe a four-BR option is a good compromise. But if all you have is a six-BR design, and you either build the house as planned or you have to rent and not be a homeowner, the parents might decide to just go ahead with the plans. Who knows? Maybe they will have four or five kids, or maybe they will have an aging parent move in with them. So the momentum to build the six-BR home, plus the uncertainty of knowing the future, becomes a huge factor in the final decision.

The school community of non-tax-paying "stakeholders" all want six bedrooms, because that is best, it covers all the unknowns, and money is no object. And the School Committee plan as it currently stands is to hire an architect to scope out a design and price tag for the six-BR option without getting the parents to agree on that size house and the resulting increased cost in advance.

If enough time passes between the start of this process and the need to make a final decision (and it has already been over a year), many people will just go along with whatever the school wants, because they haven't been involved, they don't know the issues, and there has been so much "process" that at some point we just need to accept the plan or tear everything up and start over. Once we've spent a few hundred thousand dollars on various plans, and costs to repair and upkeep the current buildings keep climbing, the decision to just acquiesce to the only plan on the table will be immense. That results in the "take it or leave it" decision which may convince people to vote "yes" even though it isn't their preference.

All that pressure will come to bear on the property-tax override vote. Taxpayers will then have that "binary choice" but by then, the School will have deliberately put all its eggs in the one basket. Either voters agree to raise their taxes by thousands of dollars per year, or our school buildings will literally fall apart because the buildings won't be kept up due to their potential pending dismantling.

There is a fair and honest way out of this future choice, and that is to give voters a simple choice now. Do they favor going down the path of a potentially $250 million project which will likely require a large property tax override, or do they want to instruct the School Committee to explore solutions which may not result in brand new buildings but will keep costs reasonable such that there will be little or no increase in property taxes outside of Proposition 2 1/2?

AN EXAMPLE OF ASSUMPTIONS

Here is another example of assumptions, this time having to do with the number of buildings we need.

Let's say a school has three classrooms per grade and seven grades (K-6). That is a total of 21 classrooms. Each classroom is designed to hold 25 kids. So the total student population is potentially 525.

If you then decide that even though 25 kids have been fit into these classrooms many dozens of times over the years, but new educational guidelines only recommend 15 kids in that size classroom, guess what happens? Your school can now only fit 365 kids.

I'm going to make up some numbers now, so don't hold me to the specifics. But I'm fairly sure this will give a good idea of the disagreement I have with how the School is making their assumptions about the need to maintain six elementary school buildings.

Douglas School is an example of this. The "maximum" number of students that Douglas can hold, according to the consultants, was like in the high 200s or the low 300s. Yet (from memory) we've had 400-500 kids in there for many years. So if you assume that we are and always will be overcrowded, then you must conclude that we can't close a building to save money because there is no over-capacity.

So to make my point clear, I am fine with a classroom of 25 students. We've done it for years, and we've had great success as a school district. And we can't afford to have a school system that assumes 15 students per classroom. If a parent wants that size classroom, they are free to send their child to private school.

In my example above, if we have six elementary buildings at 500 kids each, we can educate 3,000 kids. But our elementary school population is like 2,500 now or less, because of declining enrollment. So if we eliminate one elementary building, we can still hold 2,500 kids which is roughly where we are now, with further declines anticipated.

I took a quick look at the recent numbers. Total class sizes were in the 400s in the higher grades, but in the 300s in the K-5 grades. So we have lost or are losing around 100 kids per grade. If you save 100 kids times 7 grades, that is 700 vacancies, or more than enough to reduce the number of elementary schools from six to five.

Eliminating one building not only reduces our potential renovation/replacement cost by about 15%, it also reduces our operating costs by roughly the same. We lose a building's principal staff and office, one building's maintenance and utilities, and we eliminate many classrooms and teaching staff. Yes, it may mean that class sizes go up more than if we very slowly don't replace a few teachers, but making the change all at once highlights the potential savings and doesn't allow those savings to be "repurposed" to pay for other "nice to have" expenses. If we eliminate say 20 classrooms, plus the other savings in closing the sixth building, we might save $2-$3 million a year, which can go right to the bond payments to pay for the new or refurbished remaining buildings.

REPURPOSING

Let me talk about "repurposing" for a minute. The School typically budgets all available revenue each year. If there is, say, a staff reduction of one teacher because of declining enrollment, we don't see the budget lowered by the $125,000 cost of that classroom elimination. No.

Instead, we see a new administrator hired and "paid for" by the teacher reduction. And it looks good, doesn't it? We aren't increasing staff, we are maintaining it, because we are repurposing that teacher's salary to pay for a new administrator, a new special ed teacher, expanded hours for the music teacher, or what have you.
I've been to several School Committee meetings which show a chart around budget time called something like "net staff changes." It may show that we lost five positions but are adding seven, so our "net" increase is only two. Gee, adding just two people isn't that many, is it? Surely a net addition of just two staff people is quite reasonable when we have a School District with around 1,000 employees, right?

This is why with declining enrollment we see no moderation in the increase in School spending. And Acton's School assessment, because of the unfair regional funding formula, keeps increasing relative to Boxborough. So whatever savings might theoretically be passed down won't ever be seen by Acton taxpayers in any case.

Of this, I'm not kidding. Acton taxpayers are about to be mugged by their friends in Boxborough. Take a look at the assessment chart in this year's budget info and note how the percentage that Acton is going to pay is going up. (Each 1% represents 1% of the roughly $85 million school budget, or roughly a 1% property tax increase!)
Here is the chart (12/1/16 packet). Look at the bottom one on the page, last column (recalcuated assessment percentage):
http://www.actonforum.com/sites/default/files/Assessment.pdf

But there are never any net savings, not when the declines happen slowly and are allowed to be repurposed. So the only practical way to actually save money when dealing with this bureaucracy is to have the savings so large that they can't be repurposed, and that is why "closing a building" all at once can actually help pay for our new construction projects.

I would go further and say that we should go back and add up all classroom reductions over the past five years and see how much has been "saved," and then require the School to dedicate those savings towards their renovation/replacement project before asking for any increase in taxes, whether within or outside of Proposition 2 1/2.

My guess is that the School could fund around $5 million per year within its budget to pay for school construction costs, based on savings already realized, closing a school, and anticipated savings due to further enrollment declines. And then if the school building projects/renovations can be kept to $100 million, we could use say 1% of our property tax increase (close to $1 million per year) to go towards buildings and capital, which can be done if we hold down future cost increases for teacher and staff salaries and benefits.

Each year we save money on staff salaries and benefits, it compounds. So $1 million in Year One and another $1 million in Year Two means $2 million in Year Two (for a total savings of $3 million over two years.) Another $1 million in Year Three means $3 million per year with a total three-year savings of $6 million. So around three years of lower increases and we would build a $3 million annual revenue stream within our budget to pay for buildings and capital.

We have been accepted into the state's school building reimbursement program for Douglas School, so maybe the state would kick in $20 or $30 million towards a $70 million renovation project. And maybe, when all the math is done, we will still be a little short and will need an override. But if that happens, it will be far less than what the School is going to propose with the plan they are advancing now.